Gena Riede, Real Estate Pro in Sacramento, CA

What is the Luxury Market like in San Diego?

Asked by Gena Riede, Sacramento, CA Sat May 12, 2007

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Gena: The luxury market in San Diego is still running strong. In fact, a $50 million beach property in Del Mar will be closing soon. The toughest segment in San Diego's luxury market is for those homes located away from the coast and for the lower end of the luxury market. Days on market can tell us much. Luxury home prices are holding relatively steady because many of these buyers are not affected by tightened loan requirements.
4 votes Thank Flag Link Sat May 12, 2007
Roberta Murp…, Real Estate Pro in San Diego, CA
Remember the old Timex slogan? That's the luxury market in San Diego County; it takes a licking and keeps on ticking.

That market is less susceptible to interest rate swings and mortgage affordability
Web Reference:
2 votes Thank Flag Link Sat May 12, 2007
While homes $1+M continue to sell, the real story is the discounted prices for which some of them are selling. Former wealth has been hit hard by this economy and some sellers simply held on too long. Here along coastal San Diego including Del Mar-La Jolla we've seen oceanfront homes that had been asking $29M in 2008 sell for $17M in 2009. And I agree with the agent's comment re: 50% reductions in Rancho Santa Fe, Rancho Pacifica and similar high-end developments east of I-5. And there are a few lovely building lots that can still be purchased at deep discounts. High-end properties are like fine art - the beauty and value is in the eye of the beholder. The problem today is there are far fewer "beholders" (buyers). And far more sellers of fine homes who have cashflow and inability-to-refinance issues. Generally speaking, investors have already grabbed most of the good sub-$500K condos along the coast. The greatest discounts can be had in the luxury single family detached properties - even those with ocean views or are oceanfront...provided they have the finances to complete the deal.
0 votes Thank Flag Link Tue Jul 20, 2010
Roberta its nice to see that you are still working in the industry. I know since the question was asked in 2007, the real pros stuck it out.

The opinions vs the new reality since the first answer in 2007 are pretty funny! For the most part, no market will evade a recession as deep as this one.

Rancho Santa almost half off the highs and the foreclosures keep piling as owners walk away. If you have a good agent that knows the sub markets in the county, you can definitely get a nice deal right now.
0 votes Thank Flag Link Sun Jul 18, 2010

It's been a year since you asked this question, and the results are now mixed. If a luxury home bargain in San Diego is the goal, it can be found. However, that bargain will likely not be near the coast.

There are luxurious and large newer homes further east in San Diego County where you can find short sales, foreclosures and slashed pricing. Some remarkable bargains can be found, where luxury homes are less than 12 miles to the beach.

The coastal market is holding steady, with single family home pricing remaining relatively flat. The beach-close condo market has softened somewhat--especially with one-bedroom units.

Roberta Murphy
0 votes Thank Flag Link Sun May 11, 2008
Roberta Murp…, Real Estate Pro in San Diego, CA
Better neighborhoods always retain value and fluctuate less that other areas. It’s funny because I get requests from buyers to let them know about foreclosures in Coronado or LaJolla or even North County inland. I tell them that I will set up the searches for them that meet their needs but don't count on many (or any) results. The luxury market is pretty much the top 10% of the home values in a given area. Foreclosures and short sales rarely happen in the segment.
0 votes Thank Flag Link Sat May 10, 2008
There are luxury submarkets that are being judged separately in the present economic climate. Established properties close to coast are doing well whereas new construction further inland is taking a hit. Even luxury homes in preferred neighborhoods yield to basic principles of real estate value in a buyers' market.
Web Reference:
0 votes Thank Flag Link Wed Apr 30, 2008
In the last 25 days, 25 homes closed escrow in La Jolla, Ca. Three of them under $ 1,000,000. Seven, between $ 1,000,000 and $ 2,000,000. Seven more between $ 2,000,000 and $ 3,000,000. Three more between $ 3,000,000 and $ 4,000,000. Three more between $4,000,000 and $ 5,000,000. One more,
$ 6,889,000, and the last one a whooping $ 17,000,000. Not so terrible. And I am not counting condominiums and townhomes.
0 votes Thank Flag Link Sun Nov 11, 2007
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